How insurance companies can channel the power of Web3
As technology closes the gap between the real and the virtual, it has become more important than ever for carriers to consider how customer needs—and their ability to meet them—will evolve. In our latest Accenture Insurance Technology Vision 2022, we outline how the metaversal continuum will impact the industry over the next decade.
One of the most important trends emerging when we talk about the metaverse is the development of Web3. This term may be new, but it encompasses much of the technological advancements and activities that already occur naturally on the Internet. Web3 refers to an iteration of the World Wide Web where decentralization, blockchain technologies, and token-based economics build new, secure ways of connecting and trading.
This new vision for the internet includes the creation of immersive virtual worlds, blurring the lines between digital and physical, and could create the biggest shift we̵7;ve seen in digital technology since the inception of major tech platforms like Facebook.
What unique challenges and opportunities does the metaverse present to insurers?
Essentially, insurance companies face the daunting and exciting challenge of insuring a changing world. A person can just as easily get injured in a game of VR golf as he/she can on a physical course. A customer can lose their physical possessions in an armed robbery, or lose money in their account through identity fraud.
Aviva, the UK’s largest insurer, revealed in recent research that claims for accidents caused by Metaverse and virtual reality (VR) gadgets have increased by 31 per cent in the past year. They identified metaverse-related risks that included physical harm to their surroundings while wearing headsets; avatar identity theft and anonymity-based crimes; violations of metaverse etiquette and privacy risks through data breaches and leaks; and exploiting user biometrics and online behavioral data. The horizon of what constitutes risk is changing. Insurance companies face the daunting but exciting task of building new platforms, products and services; secure technology; and identify use cases and business models.
Securing the metaverse
While the metaverse is still a new perspective, it offers insights and opportunities for connecting with customers. As this technology evolves, insurers can leverage research and listen to their customers to isolate, test and act on opportunities. For example, North American integrated financial services company IMA Financial Group launched its own IMA Web3Labs, which is metaverse’s first research and development facility for insurance and risk management. The facility will be located in Decentraland, a virtual world based on blockchain technology. Funded by IMA’s investment arm, IMA Investments Inc., Web3Labs sets new industry expectations for exploring, testing and executing market risk and insurance strategies specific to the metaverse.
The Importance of Insurance Partnerships in the Metaverse
As we’ve discovered in other areas of insurance, strategic partnerships can help insurers rapidly develop and scale solutions in new markets, giving them more agility than if they approached it on their own. This is no different in the case of Web3. In fact, the seamless, decentralized nature of Web3 makes the design of partnerships critical. Leading insurers will accelerate their cloud transformations, rebuild applications with microservices architectures, and deploy open application programming interfaces (APIs) to accommodate upstream and downstream data flows with ecosystem partners. Consider the case of Checksig, which has partnered with SATEC Specialist Underwriting to create bitcoin and crypto solutions for retail and institutional investors. SATEC is the special guarantor for Cattolica Assicurazioni (Generali Group).
Conclusion
In conclusion, the metaverse offers the opportunity for insurers to engage with customers in a new dimension. While it may not be an urgent consumer trend, leading underwriters should be proactive by staying on top of the trends impacting the metaverse and actively seeking opportunities in this area that are a good fit for the brand. This is best achieved by using smart partnerships and metaverse accelerators.
Get in touch to discuss how your insurance company can use the metaverse to connect with new customers and opportunities.
Accenture Insurance Technology Vision: Find out how today’s metaverse innovations are becoming the building blocks of the insurance industry’s future.
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Disclaimer: This content is provided for general information purposes and is not intended to be used as a substitute for consultation with our professional advisors.
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